Forecasting, or prediction in general, is about making statements under uncertainty. That uncertainty may be time-related, for events that happen in future. But it can also be location-related, for events you can’t observe. To make forecasts one can use many methods, both statistical and judgmental, and follow scientific principles. But most forecasts are notably wrong by definition, as the goal is to minimize the expected error.
Many organisations use forecasts daily to make decisions on important issues. Forecasting is used in demand planning in manufacturing, setting the directions for production and procurement. It is also used in supply chain forecasting and sales & operations planning (S&OP). In most companies the forecasting process is not only about the numbers, but also a means to reach consensus with stakeholders.
Applied Forecasting is a free and independent website on Forecasting. We look at developments in forecasting software, research, books, events and competitions for researchers, practitioners and students. This blog is a public service of ManagementScience.nl, a operations research consultancy based near Amsterdam, The Netherlands, Europe.